Population health at the heart of a successful business model
A recent Viewpoint article published in JAMA, How Disruptive Innovation by Business and Technology Firms Could Improve Population Health, noted there are opportunities for the business and technology sectors to make an impact on population health. While we fervently agree, the key to achieving this ambition extends beyond profit – it involves appreciating the fact that health is both a critical input and output of organizations.
The emergence of John Elkington’s “triple bottom line” more than 25 years ago turned the traditional profit-focused worldview on its head. It started a wave of improved standards of corporate responsibility and sustainability. Michael E. Porter and Mark Kramer’s groundbreaking concept of creating Shared Value, first noted in the Harvard Business Review, provided a blueprint for how organizations could do good by solving societal issues while being successful.
Central to Shared Value is the virtuous cycle created between company, consumer and society when businesses compete to develop products that serve a societal need for a broad swath of the population. Our parent company, Discovery Vitality – a global insurer with more than 8 million clients in 18 countries – pioneered Shared Value in the insurance space. Unlike traditional insurance policies that provide peace of mind, but not much beyond, Discovery Vitality rewards individuals for healthy behaviors throughout their policies.
Central to this model is the nature of the health burden that plagues society. In the United States, behavioral risk factors contribute to 43.5 percent of the attributable fraction of Disability Adjusted Life Years. These mainly comprise tobacco use, poor diet, alcohol and drug use, and physical inactivity. By facilitating and sustaining change in risk behaviors, the member, insurer and society more generally all benefit.
The combination of robust science, technology and incentives has proven to be a potent combination to facilitate behavior change at scale. Examples of how this has been achieved include:
- Allowing people to earn an Apple Watch for a nominal activation fee, provided they exercise regularly, thus making cutting-edge technology accessible and using the financing to better align use with outcomes
- Providing discounts on healthy grocery purchases, making the healthier choice more affordable
- Leveraging information about a member’s unique risk profile to facilitate access to leading health applications and coaching services through a technology hub
Businesses are both a beneficiary and contributor to population health. As such, there is an opportunity to reimagine the business value chain, not with population health as the beneficiary of a generous corporate benefactor, but rather a core component of a successful Shared Value model.